Financial Maths · Ordinary Level
Foreign Exchange
Ordinary Level · Part 6 · Tap NEXT to begin
Section 1 of 3
Converting Currencies
Which way?
If €$1 = \$x$, then going from € to \$ you multiply by $x$; going from \$ back to € you divide by $x$. (Same idea if the rate is given as \$$1 = $€$y$.)
Worked example — dollar rate
$\$1 = $€$0.86$. Find the value of (i) $\$256$ in euro; (ii) €3540 in dollars.
(i) $256 \times 0.86 = $ €$220.16$
(ii) $\dfrac{3540}{0.86} = \$4116.28$
€220.16 and \$4116.28
Worked example — euro rate
€$1 = \$1.15$. Find the value of (i) €356 in dollars; (ii) $\$2423$ in euro.
(i) $356 \times 1.15 = \$409.40$
(ii) $\dfrac{2423}{1.15} = $ €$2106.96$
\$409.40 and €2106.96
You try
€$1 = \$1.09$. Find the value of €500 in dollars, and of $\$654$ in euro.
€ to \$: multiply by $1.09$. \$ to €: divide by $1.09$.
$500 \times 1.09 = \$545$
$\dfrac{654}{1.09} = $ €$600$
\$545 and €600
Section 2 of 3
Cross-Rates — Through the Euro
Go via the euro
To swap between two currencies that aren’t euro, convert to euro first, then from euro to the other currency — two steps.
Worked example — pounds to dollars
€$1 = \pounds0.95$ and €$1 = \$1.08$. Find the value of $\pounds265$ in dollars.
$\pounds$ to €: $\dfrac{265}{0.95} = $ €$278.95$
€ to \$: $278.95 \times 1.08 = \$301.26$
\$301.26
You try
€$1 = \$1.09$ and €$1 = \pounds0.93$. Find the value of $\$568$ in pounds.
Dollars to euro first (divide by $1.09$), then euro to pounds (multiply by $0.93$).
\$ to €: $\dfrac{568}{1.09} = $ €$521.10$
€ to $\pounds$: $521.10 \times 0.93 = \pounds484.62$
£484.62
Section 3 of 3
Finding the Exchange Rate
Same item, two prices
If one item costs $A$ in one currency and $B$ in another, those prices are equal: $A = B$. Divide to get the rate for $1$ unit.
Worked example — from two prices
A coat costs €250 in Dublin and $\$285$ in New York. Find the exchange rate.
€$250 = \$285$
€$1 = \dfrac{285}{250}$
€$1 = \$1.14$
You try
A phone costs €600 in Dublin and $\$690$ in New York. Find the exchange rate (euro to dollars).
€$600 = \$690$, so divide both sides by $600$.
€$1 = \dfrac{690}{600}$
€$1 = \$1.15$
That’s Financial Maths — the whole topic.
Ratio & proportion, percentages, profit/loss/error, compound interest, income tax, and foreign exchange — all from your notes.